Uduma Lebbe v. Kiribanda.
Present: Canekeratne J.
UDUMA LEBBE et al., Appellants, and KIRIBANDA,Respondent.
263—C. R. Kandy, lfl33
Trust—Specificperformance—Sale of land—Condition for repurchase
within a certain period—Claim by vendor’s heirs for specific performanceof agreement to retransfer, after expiry of specified period—TrustsOrdinance (Cap. 72), ss. 96, 97.
CANEKERATNE J.—Uduma Lebbe v. Kiribanda.
Ui., who died on May 19, 1945, had sold a land to the defendanton August 9, 1940. The habendum clause of the deed of transfershowed that the vendee was “to have and to hold the land subjectto the condition that the vendee agreed to retransfer the land to thevendor by paying a sum of Rs. 100…. within a period of
5 years from the date hereof
Held, that the heirs of U.L., some of whom were minors, could not,,alleging the existence of a trust, obtain specific performance of theagreement to retransfer, after the expiry of the period specified in theagreement.
PPEAL from a judgment of the Commissioner of Requests.Kandy.
W. Thambiah, for the plaintiffs, appellants.
C. E. S. Perera, for the defendant, respondent.
Cur. adv. vult.
March 12, 1947. Canekeratne J.—
This is an appeal by the plaintiffs, the heirs of one Uduma Lebbe,from an order dismissing an action for specific performance of an agree-ment. Uduma Lebbe, who died on May 19, 1945, sold a land to thedefendant by Deed P 1 of August 9, 1940. The habendum shows thatthe vendee was “ to have and to hold the land subject to the conditionthat the vendee agreed to retransfer the land to the vendor by payinga sum of Rs. 100 with interest at the rate of cents fifteen per Rs. 10per month within a period of 5 years from the date hereof ”.
The case as presented to the trial Judge was that a tender of moneyhad been made to the defendant by Uduma Lebbe during his lifetimeand after his death by the plaintiffs before the date specified in the agree-ment. This they failed to prove. No one can seriously contend. thatthe finding of the Commissioner was wrong. The main contentionin appeal was that the third to sixth plaintiffs were minors, that thedefendant was a trustee and that the expiry of the period specified inthe agreement does not stand in the way of an application for enforce-ment of a trust. The decission in Jonga v. Nanduwa1 holds that a conditionwith regard to repurchase Ls binding on the vendee although he hasnot signed the instrument of transfer.
The deed calls the term a condition ; I apprehend, however, thatthe name thus given to the interest acquired by Uduma Lebbe cannotchange the character of the right, but the language used must be con-sidered in order to ascertain what right or interest passed. If a stipulationor term contained in a deed amounts to a condition of such a natureas to extinguish the right of the grantee and cause the property to passto another, then, the term will take effect although the deed is not signedby the grantee, as where A transfers a property to B subject to thecondition that on the happening of a certain event the property is topass to another. The term may, on the other hand, not be a conditionof this nature; a grantor may reserve a right to deal with the land ora right to revoke the grant: such grants have been held to be good(see 4 Appeal Court Reports, page'). One way of construingsuch a grant may be this :—The grantor does not become absolutely
1 (1044) 45 .V. L. B. 128.
222CANEKERATNE J.—Uduma Lebbe v. Kiribanda.
entitled to the land, the grant confers only a limited estate on thegrantee, an estate for a particular period till the grantor deals withthe land or revokes the grant. But where a right or mere privilegein respect of the land is reserved to the grantor the reservation wouldgenerally operate as a new grant by the grantee to the grantor butthe deed -should be executed by the grantee, otherwise no legal rightis created. The provision contained in the Statute of Frauds (Ordi-nance No. 7 of 1840, section 2) would apply unless an equitable rightor interest was conferred on the grantor, for this section does not appearto affect equitable rights1; it does not affect rights arising by operationof law. One having only an equitable right in a land has obtainedrelief though there is no notarial document2. If a person entered onand agreed to have the land by force of the deed is he not bound toperform the condition in the deed ? Is this a right arising byoperation of law ?
The language used in this deed shows that a right in respect of theland was conferred on the vendor and as the deed was not executedby the grantee and as the doctrine of part performance does not applyin Ceylon the agreement would be unenforceable by section 2 of theStatute of Frauds. It is contended that there is a trust. AbdulMajeed conveyed the land for a sum of money to the defendant andintended to make the defendant the owner. In these circumstancesit seems that both the beneficial and the legal interest in the propertypassed to the defendant. If both the legal and beneficial interest wereintended to pass and did pass it is difficult to see how any questionof trust, as known to English Law, could arise. Mr. Thambiah con-tends that the reasons given in the judgment—Jonga v. Nanduwa'—are binding on me. The provisions of section 96 of the Trust Ordi-nance (Chapter 72) were applied to the facts of that case. The languageof the section assumes that there is no trust—(“in any case . . . .where there is no trust ”—see also section 83). According to the.section the grantee must hold the property for the benefit of the personhaving the beneficial interest therein to the extent necessary to satisfyhis just demands, i.e., from the dale of execution of P 1 the defendantLad, according to this view, to hold the land for the- benefit of the grantorto the extent necessary to grant him a retransfer of the land if he demandedone. So far no difficult situation is created in this case for the defend-ant did not say that this term was not binding on him.
The next contention of Council for the appellant is that the doctrineof equity that time is not of the essence of the contract applies to thiscase as the defendant is a trustee. He strives to make the doctrineone of universal application when it is not so.
The plaintiffs are not, according to the argument, debarred frommaking a tender at any reasonable time. It was urged by Counselfor the respondent that the decision in Jonga v. Nanduwa (supra) itselfshows that the tender must be made within the time specified and he.referred me to page 130.
1 Rochfaucald v. Botulead (1897) 1 Chan, at page 203.
Could v. Inasitamby 11904) 9 N. L. JR. 177 ; Narayanam v. Finlay (1927) 29 N. L. fi. 65.
(1944) 45 N. L. R. 128.
CANEKERATNE J.—Uduma Lebbe v. Kiribanda.
The words must, as a matter of construction merely, have the same-meaning in equity as at law. The rights and remedies consequenton that construction may be different in the two jurisdictions but thegrammatical meaning of the expression is the same in each. If this beso, time is part of the contract, and if there is a failure to performwithin the time the contract is broken in equity no less than in law.But in equity there may be circumstances which will induce the Courtto give relief against the breach, and sometimes even though occassionedby the neglect of the suitor asking relief: but at law the legal conse-quences of the breach must be allowed strictly to follow. In equity aperson may make out a case for relief against the breach of the contractin two cases—in mortgages and specific performance. Time is not ofthe essence of the contract in mortgages or there would be no sucnthing as an equity of redemption. This rule will not help the plaintiffsfor there has been no contention that a mortgage was created by P 1.
As regards specific performance the rule laid down by Lord JusticeTurner in Roberts v. Berry1 is this :—A Court of Equity will enforcespecific performance and relieve although the dates assigned by the con-tract are not kept if there is nothing in (i) the express stipulation be-tween the parties, (ii) the nature of the property, or (iii) the surrounding,circumstances, to make it inequitable to interfere with or modify thelegal right. Equity enforced contracts for the sale and purchase ofland though the time fixed therein for completion had passed where,unless the contrary intention could be collected from the contract,the Court presumed that time was not an essential condition. Buttime is material owing to the nature of the property in several cases,one of which is in options to purchase or sales with options to purchase—Dibbins v. Dibbins Specific performance is a remedy not unknownto the Roman-Dutch law. The juristic writers are all practicallyunanimous that obligations ad dandum, i.e., a contract of sale, could bespecifically enforced’; it is a remedy well known to the law of Ceylon ’ ;the principles observed in the granting of relief are those of the Roman-Dutch law, not of the English law on the subject If analogy is asafe guide the rule applied by English law in transactions other thansales of land as options may usefully be applied here.
Counsel for the appellant lastly contended that the defendant wasa trustee for the plaintiffs, the beneficiaries, and that they were entitledto some sort of relief. The defendant, however, was not a trustee norwere the plaintiffs cestuis que trust. The remarks made by Lord Westburyin an action brought against a person who was the surviving partnermay well be referred to (Knox v. Gye c) :—“ Another source of error in thismatter is the looseness with which the word ‘ trustee ’ is frequently used.The surviving partner is often called a ‘ trustee ’ but the term is used'
> (1853) 3 Dc G. M. <fe G. 284.
(1X96) 2 Chan. 348.
Grotius Introduction 3-2-14, 3-15-6.
Schorer, note 311.
Voet 19-1-3: but see 19-1-14, and cf Berwick’s Translation, revised edition 80.Vcinder Linden (Henry) 198.
Holmes v. Marikar (1896) 1 K. L. JR. 282.
Abeyesekera v. Gunasekera (1918) 20 N. L. R. 404.
Law Reports, Eng. <& Irish Appeals, Vol. 5, 675.
Buhari v. Jayaratne.
inaccurately. He is not a trustee either expressly or by implication…. The advantage of correcting by familiar practice an in-
accurate use of a word, although that use may be found in treatises ofreputation, I remember to have seen singularly illustrated in a casethat occurred some years ago in a Court of Law, where the Court of Lawwas told that in an agreement for the sale of a house the vendor wastrustee for the purchaser, and the Judges were called upon to applya rule which is quite right as between a complete trustee by declarationand the cestui que trust, but quite wrong where the vendor is calleda trustee only by a metaphor, and by an improper use of the term ;and it required some trouble to convince them that though the vendormight be called a trustee he was a trustee only to the extent of hisobligation to perform the agreement between himself and the pur-chaser …. It is most necessary to mark this again and againfor there is not a more fruitful source of error in law than the inaccurateuse of language. The application to a man who is improperly, and bymetaphor only, called a trustee, of all the consequences which wouldfollow if he were a trustee by express declaration—in other words acomplete trustee—holding the property exclusively for the benefitof the cestui que trust, well illustrates the remark made by Lord Mans-field, that nothing in law is so apt to mislead as a metaphor. Thisis one of the sources of error in this case ”.
The obligor has to perform the same duties as if he was a trusteeof the property (section 97) but this cannot be made use of to show thatno time can run as between him and the heirs of the grantor.
The appeal must be dismissed with costs.
UDUMA LEBBE et al., Appellants and, KIRIBANDA Respondent